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Member, Beacon International Group, Ltd.
CHRISTCHURCH, New ZealandThe earthquake that struck New Zealand caused insured damage of $1.5 billion to $2.5 billion, catastrophe modeler EQECAT Inc. said Friday in an updated estimate.
Economic damage is expected to amount to as much as $3.5 billion from the magnitude 7.0 earthquake that struck in the early morning hours of Sept. 4 in a region that includes Christchurch on New Zealand’s South Island, Oakland, Calif.-based EQECAT said.
Damage to residential property is expected to cost insurers as much as $2 billion and EQECAT estimated insured commercial property damage from the quake at $200 million to $500 million.
The uptake of earthquake insurance in New Zealand’s commercial market is a fraction of that in the residential market, EQECAT said. That is particularly true for older buildings, such as those made from unreinforced masonry that incurred much of the quake damage, the modeler said.
Damage at the Port of Lyttelton in Christchurch may make up the bulk of insured commercial losses, according to EQECAT. The port suffered significant damage but reopened to shipping not long after the quake struck.